LIG D&A Faces Two-Year Ban on Public Bids; "Will Seek Stay and Sue to Overturn"

Sanctioned by DAPA following indictment on bribery and other charges

Barred from public-sector bidding starting October 29

LIG D&A: "Will seek suspension of enforcement and file lawsuit to overturn sanction"

LIG Defense & Aerospace (LIG D&A) has been barred by the Defense Acquisition Program Administration from participating in bids by government and public institutions for two years. The company plans to challenge the sanction through legal action, including an application to suspend its enforcement and a lawsuit seeking its cancellation.

LIG D&A Pangyo House. LIG D&A

LIG D&A disclosed on October 22 that it will be barred from participating in bids by the central government, local governments, and public institutions from October 29 through October 28, 2028. The company said it received the administrative sanction notice from the Defense Acquisition Program Administration that day.

On October 20, the Defense Acquisition Program Administration’s Defense Procurement Contract Deliberation Committee met and decided to impose a 24-month ban on bidding under the State Contracts Act. The measure follows a bribery and cost-fraud case announced by prosecutors in August and concerns a counter-small-drone system project among the related projects.

LIG D&A officials are suspected of, among other things, providing more than 300 million won in bribes to Defense Acquisition Program Administration employees. The agency said it took into account the largest amount of bribes since its establishment, as well as planned misconduct carried out over an extended period, in deciding on the sanction. Legal proceedings over the related allegations are ongoing.

If the sanction remains in effect, it could constrain the company’s ability to win new domestic projects. Last year, revenue from the central government, local governments, and public institutions totaled 2.7773 trillion won, or 64.5% of its consolidated revenue of 4.3069 trillion won. This figure represents the share of revenue from those customers last year and does not indicate the expected revenue loss resulting from the sanction.

LIG D&A plans to challenge the measure by applying to suspend enforcement of the sanction and filing a lawsuit to have it overturned. The company said that if the court grants the suspension, the sanction will not affect its eligibility to participate in bids until a ruling is issued in the cancellation lawsuit. A LIG D&A representative said, “We regret that an administrative sanction was imposed based on the indictment while legal proceedings are ongoing. To avoid disruption to our business, we will pursue legal action, including applying to suspend enforcement of the sanction and filing a lawsuit to have it overturned, and will diligently present our position.”

This content was produced with the assistance of AI translation services.